Subcontracting and its ramifications: A survey of the building industry in Hong Kong

There has been increasing concern on excessive subcontracting. This study reviews the case of Hong Kong, in particular the consequence of high & growing rate of subcontracting and what project managers can do. Based on statistics and elemental cost analyses, we find that as much as 80% of the value of building works is undertaken by small subcontractors. Whilst subcontracting provides the industry with specialized services as well as organizational and managerial flexibility, it has also been attributed to the labour intensity and the lacklustre performance of the industry. It relies on project manages to make the best use of what subcontracting has to offer, whilst avoiding its pitfalls. An assessment of the extent and issues of subcontracting helps us understand how project management could enhance the performance of the projects and then the industry.